USDA Proposed Income Limit Increase Postponed

Even though we had it on good authority (we even had it in writing that unless someone complained it would take place January 20), USDA has postponed the 2-tiered income system, which will allow more buyers to qualify for this program, until March 20.  I have heard that the reason for this postponement is that they have already used their FY2009 congressional appropriations in the first quarter, from October 1, 2008 – December 31, 2008 (actually, I believe they were used up as of January 9, 2009).

While they have used all of the current appropriated funds, USDA RURAL HOUSING LOANS ARE STILL ABLE TO BE ORIGINATED AND CLOSED!  Here in our market, there are several lenders telling Realtors and clients that “USDA Rural Housing is out of money”.  Congress has promised a perpetual appropriation this year and it is up to the discretion of the lender if they decide to move forward and continue doing these mortgages.  Also, it is important to note that the USDA does NOT lend money; they insure loans.  The investors are the ones that provide the money and our investors are still doing exactly that.

Here at Northstar Mortgage, we are still able to do them and to get them to closing!  We are having no interruption of business with the USDA Program at all.  If you are buying a property, or a Realtor who has sold a property, in FL, AL, GA, NC, SC, or TN and need it to get to closing quickly on the USDA Program, please have your client contact me or you can contact me.  I hate to think that because some people are not doing these loans while others are that some buyers and sellers may lose the ability to get their loans closed and miss out on the great rates that we are currently able to get.  I recently locked in a USDA program mortgage on a 30 year fixed rate mortgage at 4.875% with NO POINTS and NO ORIGINATION FEES!  These rates won’t last forever so don’t miss out on this great opportunity to buy a home, or have your clients get a home, with NO MONEY DOWN!